New blow for south homeowners

HOUSE prices in the South look set to fall by the end of the year, but double digit growth will continue in northern regions, says City spread betting group IG Index.

The company expects the cost of property in London to have fallen by 7.3% to average £198,700 by the end of 2003, while in the South East prices look set to drop by 1.7% to £186,500.

But prices in the North will soar by 11.1% to average £86,100 during the year, while in Scotland they look set to end 2003 10.4% higher at £79,300. In the South West and East Anglia the group is expecting prices to creep up by 4.4%, while Northern Ireland looks set to see growth of 7.5% and prices in other regions will rise by around 8% and 9%.

Bradford & Bingley Estate Agents reported that house prices in the South East and London had fallen by 6% during the six months to the end of February, driven by falls at the top end of the market, while in the South West they were down by 5.8%. But the cost of a home in Yorkshire has soared by 15%, while in the East prices are 11% higher and in the Midlands they are up by 9.8%.

Overall the group, which measures the price properties sell for at its 304 estate agents, said the cost of a home in England and Scotland was an average of 2.2% higher than six months ago at £144,838.

Gary Verity, general manager of Bradford & Bingley Estate Agents, said: 'Our figures show that the market has levelled following the almost frenzied activity we saw last year.

'Looking ahead we do not expect a significant fall. In fact our figures for March so far suggest both the number of instructions and buyers are marginally up on the same period last year.'

The group said there had been a 5% rise in the number of first-time buyers entering the market during the past six months, which it said would help keep the bottom of the market moving. It added that the 'logjam' it reported six months ago had begun to ease as more properties came on to the market.

Although demand still remained strong with an average of seven buyers chasing each property for sale, the panic buying witnessed during 2002 seemed to be easing.